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Canada British Columbia B2C digital services PST

BC retrospectively broadens PST net on software

The Canadian province of British Columbia has retrospectively widened the Provincial Sales Tax net on software. The change removes the limit of sales tax obligations from just ‘software programs’ to software. This means many digital services that did not include a direct interaction by the user with the underlying software program are now liable to PST.

This applies back to 2013 for resident businesses; 2021 for non-resident businesses.

April 2021: Canadian province levies Provincial Sales Tax on non-resident digital service providers

The Canadian province of British Columbia has extended the liability to Provincial Sales Tax (PST) on out-of-state providers of digital services since April 2021. The measure, delayed from last year with the COVID-19 crisis, follows many other provinces, including Quebec and Saskatchewan. The federal state levies 5% GST on foreign sellers since 1 July 2021. Manitoba imposed PST from 1 December 2021.

Check our global VAT and GST on digital services tracker to see which other countries have introduced indirect taxes on electronic services to consumers.

The obligation to register as a foreign provider will be triggered by the following criteria:

  1. Annual sales above C$10,000 per annum in British Columbia
  2. Sales of B2C software for use on or with an electronic device, including telecommunication services
  3. Take sales orders from British Columbian consumers to buy software for use on or with an electronic device

British Columbia PST is currently 7%.  Check global VAT and GST rates with VAT Calc’s tracker

You can check the correct digital services VAT calculations on individual or batch transactions with our Advisor and Auditor tool.

North America VAT on digital services

Comments (click for details) Rate Implementation Date Threshold Comments
Canada 5% Jul 2021 C$30,000
Canada British Columbia 7% Apr 2021 C$10,000
Canada Manitoba 7% Dec 2021 C$10,000 B2C; accommodation sharing
Canada Quebec 9.98% Jan 2019 C$30,000
Canada Saskatchewan 6% Jan 2019 Nil for non-residents
Mexico 16% Jun 2020 Nil
United States Up to 10% 2018+ Varies by state


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